Worth selling $25,000 car that is not used often? Living and working in Melbourne CBD. Trying to get ahead.

E5TOQUE on 27/05/2017 - 08:38

Hello everyone,

After coming back from Europe to see family and friends it surprised me at how quite a large number of them didn't own cars. Or if they did own cars they are tiny little things (Toyota Aygo, Smart Cars, Fiat 500's etc etc).

Living and working in Melbourne CBD. I never drive a car to work. I don't even take public transport. So the car is sitting in the basement garage likely 6 days a week. Maybe used once every weekend to go do grocery shopping. And whenever there is family events on (they all live in Melbourne Suburbs or country Victoria).

If I sold the car privately on carsales we would get about ~$25,000. Which can go along way to a deposit, shares, etc etc. It just feels like a complete waste of money having an asset sitting in the basement carpark loosing money every day, while its not even being used 90% of the week.

What would the ozbargainer advice be for this? Considering family is out in country Victoria and suburbs needing access to a car is important to keep in contact with them.

  • Grocery Shopping can be done online (delivery to home)
  • Seeing family/friends we could use a carshare service (Flexicar, GreenCarShare, etc etc)
  • Or simply down size to a smaller car?
Financial

Comments

  • shrek4 on 27/05/2017 - 08:46
    +24

    Pretty sure you've made your own great argument to support selling the car.

    Based on good thinking and logic rather than emotion.

    Sell the car!

    • E5TOQUE on 27/05/2017 - 08:49

      I'm torn between selling it completely. Or just downsizing.

      The 'luxury' of being able to just go downstairs and hop into the car to go and see family and friends is something to consider. But I guess UBER/CarShare could fill that gap….

      • cloudy on 27/05/2017 - 09:00
        +2

        Lots of car share options, and taxi/uber, so I would definitely sell.

      • pandabun on 28/05/2017 - 08:41

        I would downsize into a small car. You don't realise you'll need a car until you don't own it anymore.

        Edit: change my vote to keep the car after reading you are planning to have kids and pets. You'll need the car for doctor / hospital trip in the middle of the night.

        • gimli on 29/05/2017 - 06:37
          +1

          Op can always get a car again in that case

        • pandabun on 30/05/2017 - 07:30

          @Gimli:
          True. But I feel that buying a car always costs more than keeping it. I could be wrong though.

      • gimli on 29/05/2017 - 06:36

        Down sizing to something much cheaper is not a bad idea. ESP if driving is not essential you can go for something older which may need maintenance.

        Don't know much about car sharing but sounds like a good idea.

  • Nugs on 27/05/2017 - 08:46
    +4

    motorbike

    • E5TOQUE on 27/05/2017 - 08:47
      +5

      haha. Sounds good, but I am terrified of them on Melbourne streets. My uncle was in a major accident and almost lost his life (no fault of his own). So want to avoid them at all costs.

  • SharedSugar on 27/05/2017 - 08:48

    I think it is a good idea. How well does car sharing work at peak times? Will it be easy to hire a car at Christmas?

    • E5TOQUE on 27/05/2017 - 09:02

      Christmas and Summer months are something to consider. We love going down to Philip Island/Mornington Peninsula/ Lorne etc etc most weekends whenever the weather is good. So again being able to just jump into the car and head to the beach over summer is important.

      But is it worth keeping the car in the garage, barely being used to only use between December - March each year?… hmm…

      • catbug on 29/05/2017 - 08:31

        Car shares can be booked in advance so I don't think that's an issue if you know you're going to see family on a certain weekend, you could always book the car share and cancel it if you don't need it.

  • [Deactivated] on 27/05/2017 - 08:51

    It's a cheap car, I'd keep it for the convenience of having a car when I need it. More importantly why would you chose to live in the cbd?

    • E5TOQUE on 27/05/2017 - 08:56
      +13

      I live with my partner. So sharing rent costs between 2 factors in.

      When I did the maths 2 years ago (things may have changed).

      Once I factored in the following costs:

      • Public Transport costs to and from home everyday (for 2 people)
      • Gym/Pool membership costs (its at the apartment) (for 2 people)
      • 'Cost' of spending 1 hour+ each way (plus delays) getting to and from home each day (~2 hours each day). (for 2 people so 4 hours)

      It was cheaper (and better way of living) to be in the CBD close to work.

      It is great walking 20mins to and from work, im home and cooking dinner, eating dinner all before my friends and colleages are still trying to get home. I can then go to the gym/pool/relax and know im not spending a truck load each month on public transport costs/gym/pool memberships and spending quality time with my partner.

      BUT you do raise a good point - maybe we could then move into an apartment that doesn't have a carpark (cheaper rent).

      • [Deactivated] on 27/05/2017 - 09:03
        -8

        I wouldn't live in the cbd if you paid me to. Urrghh.

        • z0s0 on 27/05/2017 - 10:17
          +8

          I wouldn't own a car and live in suburbia if you paid me. Horses for courses hey?

        • tomsco on 29/05/2017 - 09:03

          You're entitled to your opinion, but after already hinting at it in your first post, I don't think anyone cares anymore.

        • isthisreallife22 on 30/05/2017 - 06:01

          You should see my place in Kangaroo Point QLD, and then I defy you to find another metropolitan address in Australia that you would live in that remotely compares.

      • braskic on 29/05/2017 - 11:37

        Could you rent your carpark out? I've seen instances of people in Sydney leasing their residential carparks to commuters for some passive income.

  • sp3ctr41 on 27/05/2017 - 09:03
    +5

    Invest more in things you use regularly throughout your life (within reason) and minimise your expenses on things which you don't need too often.

    Cars on average become worth half as much every 4-5 years. If you want something that generally won't lose much value over time, look at <2011 models. Though it may depend on what features you want.

    I am pretty much like you, I don't use my car too often, so I never invested in a car and still have an old 1998 Mazda ($1500) which is compact, has easily accessible parts, is easy to service myself and I revamped my sound system, one of the features I care about to sound better than most modern cars for less than $500. This car really isn't going to depreciate anymore than it already has. I could easily afford a $40,000 car but that would be a waste to me. Decide what you want.

  • chumlee on 27/05/2017 - 09:08

    Europe has much better transport infrastructure compared to Australia. If your car has no mechanical or electrical issues it may be worth keeping as you never know what you inherit with another car but definitely worth considering selling

  • chazfg on 27/05/2017 - 09:16
    +4

    Put your car out for rent on days you don't need it.

  • enzioFirenze on 27/05/2017 - 09:49
    +3

    sell the car and downsize to a cheaper option, you should be able to find a reliable car ~6k that you won't mind driving.

    • Kangal on 29/05/2017 - 09:12
      +1

      Yep, agree. Sell for $25,000 and buy a ~$5k car. Anything from:
      ….Mazda 2, 3, Toyota Yaris, Corolla, Ford Fiesta, Focus, Hyundai i20, i30, Kia Rio, Suzuki Swift, Nissan Tiida, Micra.

      Just look for:
      - Good Condition/Maintained
      - Automatic transmission (easier to sell)
      - Popular model/Japan built, if possible
      - <150,000 km, if possible
      - <10 years old, if possible

      • enzioFirenze on 29/05/2017 - 18:51

        you could technically do what I do as well but that takes some effort. I make sure to buy a car with >9m rego and use it for ~5m or so and sell it, you can pretty much sell it for the price you bought it or even more most of the time if you scored a bargain and then move on to another. That way, I don't get depreciation, don't pay rego and sometimes make a profit out of it all the while getting used to having the convenience of the car. It's YMMV though cz you'll have to allocate sometime to whole changing cars thing but definitely doable.

        • pencilman on 29/05/2017 - 19:06

          Wow! I HATE selling my cars!
          It's such a huge hassle - with dealers you get a crap price, and privately you have to make yourself and the car available, and you never know who's going to turn up to look at the car.

          Can't possibly imagine trying to sell a car every 5-6 months.

        • enzioFirenze on 29/05/2017 - 19:10

          @pencilman: I've been told that ;) YMMV mate, I'm a single guy living close to city so a lot of people turn up and I usually buy cars that are easy enough to sell as well.

  • nubzy on 27/05/2017 - 09:51
    +4

    Get a cheap, but reliable car for around 5k then you won't feel so bad about depreciation and paying for rego but not using it. A car is a great convenience and I couldn't live without one, even if you only use it a few days a week or on the weekend it's better than being stranded at home or wasting time on public transport (which is not cheap either). Some people are lucky to have good public transport links, and maybe living in the CBD you are one of them. Either way 25k car is a waste, get a cheap car/motorbike or evaluate public transport options.

  • [Deactivated] on 27/05/2017 - 09:58
    +3

    Sell the car

    • Baysew on 27/05/2017 - 10:06
      +1

      Yes, it's not like you can't buy another one, if situation changes or things don't work out as expected.

      • Kangal on 29/05/2017 - 09:13

        Yes, but if you suddenly need a car… you can't just get one within 30 minutes.

        (well, I suppose you can but that's not the OzBargain way, we spend at least a week looking at all the options and haggling before we settle down)

        • Baysew on 29/05/2017 - 10:19

          Hope the car battery hasn't gone flat!
          Or your car is in the panel shop after another uninsured driver has rear ended you.

          that's not the OzBargain way, we spend at least a week looking at all the options

          Exactly, so the OzBargain way is to be organized.

          OP has already stated that they are open to a car share service.

          Being in the CBD gives lots of options.
          Council blue bike.
          Trams, trains, buses, ferrys, taxi, uber all gravitate to the city.

          With the money saved on rego on the car, OP could take a Helicopter to the airport, rather than a Skybus.

        • tomsco on 29/05/2017 - 10:36

          @Baysew:

          With the money saved on rego on the car, OP could take a Helicopter to the airport, rather than a Skybus.

          Only if they get a discount on it.

        • Baysew on 29/05/2017 - 10:37
          +1

          @tomsco:

          Only if they get a discount on it.

          Book it under the name of Bronwyn Bishop.

  • MrHyde on 27/05/2017 - 10:14
    +3

    As has already been mentioned - for your situation, sell the car. Sign up for flexicar or goget. In Melbourne CBD, they are everywhere. It will still be like just going downstairs and getting into a car - just have to book it a few minutes earlier than you need it.

    For day trips or long weekends, simply hire a car from one of many car hire places on A'Beckett St and thereabouts in the North part of the city. In the long run, that will still be cheaper than owning a car outright.

  • blonky on 27/05/2017 - 10:57

    Carshare out your car

    Or sell, and lease out your car space. Use a carsharing service when required.

  • peterpeterpumpkin on 27/05/2017 - 11:33

    You could really look at the same problem 2 different ways.

    Owning a car in the CBD 30 years from now might not just be a pointless endeavour but may also become prohibitively expensive (if Singapore's governmental policies ever take shape here). So you could argue that owning any car right now is the cheapest it ever will be henceforth and something to tell your grandchildren about.

    Logic suggests we'd all be sharing cars AND their seats to minimise congestion and parking needs but humans don't work that way.

  • altomic on 27/05/2017 - 12:24
    +2

    sell the car and down size.

    considering you would barely drive it then why not buy a cheapo 10 year old car with some Kms on it e.g. 80,000kms . it's not like you're using it for massive distances .

    sell your car for $25000. buy something for $5000 - Mitsubishi Colt, suzuki swift, kia rio, etc

  • dave999 on 27/05/2017 - 13:41

    If you live near GoGet pods then you will save heaps of money. You are right that using GoGet and Uber you can have all the flexibility of owning a car and save money (and it's actually more convenient than a car because you go out and drink and get an Uber home).

  • nomoneynoproblems on 27/05/2017 - 14:51

    Lets consider the near future for a minute. Do you own your car or is it on finance? How long have you and your partner been together? Do you plan on having kids or moving out? If you so I'd think about hanging on to it, even for convenience sake.

    • E5TOQUE on 27/05/2017 - 21:26
      • We own the car.
      • 4 Years
      • We would like to have kids (and a dog or 2) in the next 3 - 5 years.
      • We would like to have a place of our own. Or at the very least have an investment property in Brisbane/Perth rented out and live in Melbourne.
  • ziaxk87 on 27/05/2017 - 18:35

    sell car for 25k and buy a cheap one for 5k. remaining towards a house in Brisbane or Perth as rental investment ( rent and save money on tax by negatively gearing it)

  • StuffnStuff on 28/05/2017 - 08:23

    If its worth $25K today next year it will probably be worth $22K.
    If you don't use it sell it and maybe get something cheaper/smaller as a run around.
    When I was in Europe last year a number of city's had a car sharing company with a difference… called car2go. https://www.car2go.com/DE/en/hamburg/how/
    Great idea, there are cars all over the place, you pickup and drive yourself and drop off anywhere you can legally park. All done via a smart phone app. The app would show you your nearest car, walk up to it, the app would unlock the car, you drive it to where ever and drop it off where ever so only pay for the time you use. If its low on fuel you fill it up with the fuel card left in the car plus you earn free time for refueling it.

  • golfer dad on 28/05/2017 - 08:36
    +1

    You should sell the car or at least downsize/downgrade and invest the capital released. In addition, you can then rent out your car spot to earn additional income.

  • giftcardinspector on 28/05/2017 - 09:07
    +1

    I sold my car while living in Caulfield.
    My family is in country Vic, I could catch the train and bus there for half an hour longer than it took to drive.
    There is stacks of options if you need a car for the day.
    I looked into http://www.flexicar.com.au/ for a bit before I moved from Melb although I admit I never used it.

    The public transport is so good in Melb, especially if you're in the CBD! I say ditch it.

  • iforgotmysocks on 28/05/2017 - 09:22
    +6

    As an individual, if you want to get ahead you need a car that's a high yield investment. Sell your car and get something around $80k.

  • pandabear on 28/05/2017 - 09:31
    +1

    Sell your car - before we got married and had kids my husband and I lived and worked in the CBD. We sold our car, saved HARD and paid off our apartment mortgage of $250k in 3.5 years on modest graduate wages. This went a long way to helping us buy our current house in the suburbs. Now we have 2 kids and 2 cars and saving has become a lot harder!

  • Bad Wolf on 28/05/2017 - 11:49
    +2

    Sell for $25k
    Your open to online shopping and getting around without a car +1
    Examine your going static costs for vehicle ie-
    Per annum
    Insurance ~$700
    Rego ~$400
    Service ~$250+
    Depreciation

    In 3-5 years when you start a family you might want a more suitable car then the current one, save money in the mean time and make money with that cash.

    Car share services/hire car for when you need a vehicle

  • goosegog on 28/05/2017 - 15:17
    +1

    Sell it - it's an unused asset. Every year you keep it & only use it minimally, the more it will depreciate.
    As another OP said, you've already worked out the best way to go, why keep spending out money on a Comodity owned but never used?

  • Peter c on 28/05/2017 - 19:53

    Australian love their cars and look upon public transport as a necessary evil. In saying that if you are not a car person perhaps owning a $25000 car is not a wise thing if it's not being used as a $25000 car. You sound like you do need a car but not an expensive one. I would sell it privately and buy a $5000 one privately. This way you will get the best price for your car and buy the best on offer when you buy privately and don't be in a rush to do either.

  • jason101 on 29/05/2017 - 06:21

    While I know this is Ozbargain I would like the peace of mind of having a car and probably a nice one too so I'd probably be inclined to keep the car. If you do sell it remember to lease out your unsuited car space on spacer or parkhound.

  • Dave Bowman on 29/05/2017 - 08:21

    I was in the same position - moved from QLD to Melbourne and rarely used my car any more.

    I decided to sell because I couldn't justify paying rego and insurance to have it just sit there.

    Used public transport and Uber on rare occasions to get around, and hired a car a couple times to go away for the weekend.

    Back in QLD now after a few years, and looking at buying the same car second hand for less than I sold mine.

  • ruddiger7 on 29/05/2017 - 08:30

    Cars depreciate at a rapid rate too. Would sell it and if you need something still for groceries get something cheap around $5k

  • dufflover on 29/05/2017 - 08:33

    Tricky one imo. I think most people use their car for personal reasons more often than your stated ones so you could sell it more easily.

    Funnily enough I overheard this convo while taking the bus home from work where the guy is telling his workmate rather than buy a second car (so not comparable here obviously) for work convenience with his wife, they used the more logical thinking that the second car was to cover 1 or 2 trips a week which equalled $1200 a year in Uber/taxis, and he makes the point that's way cheaper than a 2nd car; not too much more than the rego and insurance costs alone.

  • bargainjargon on 29/05/2017 - 08:56

    Sell it unless you really enjoy driving. But if that's the case, sell it and get a cheap, small and fun car. Maybe an old MX5 which can be had for under $5k if you keep your eyes peeled (I got a '91 for $2.5). You can fit a decent amount of groceries in the boot.

  • Scandrew on 29/05/2017 - 09:11

    I would sell the car and buy something 2nd hand approximately $10k +/-

    i.e Honda Jazz, Toyota Corolla, etc.

    Pocket the difference and put it to better use and on the other hand you've reduced your exposure to depreciation costs while still having the convenience of your own car. You could go cheaper but for around $10k I noticed you can still get relatively late model cars (which may potentially reduce any future maintenance costs) so whatever milks your cow.

    • Tech and cars on 29/05/2017 - 09:22
      +1

      Same advice as above.

      Other point to note is that once the car is valued around $10k and around 120,000 km's… when you sell it in 5 years time around 160,000 km's - you will still fetch probably around that $7-8k.

  • IWoNdEr on 29/05/2017 - 10:01
    +1

    Probably do a quick Excel adding cost of insurance + registration + maintenance + car depreciation + interest on $25000
    vs cost of public transport/uber for one day a week.

    I think you will come out ahead by selling.

  • bocca on 29/05/2017 - 10:33

    Sell. buy an asset

  • rave75 on 29/05/2017 - 10:51

    Lend your car to be used for car sharing. Rent your parking space say Mon - Friday. $$

  • Plug on 29/05/2017 - 11:12

    Sell it and get a bicycle.

  • badmitz on 29/05/2017 - 11:19

    Hey OP, partner and I were in a similar conundrum earlier this year. I too live in Melbourne CBD in an apartment and we own two cars! Albeit an old Jazz and Vw Golf

    If your car is worth 25k on the second hand market and it sounds like you're basing it off conservative estimates, that's a fair bit of value. Id probably go with what many others have said and down size to a cheaper car somewhere in the 5-7k range, factoring in 3rd party instance and rego it's still definitely worth keeping a car, you never know when you might need it.

  • lookwithin on 29/05/2017 - 13:13

    Maybe pop a quiz out to see what the majority will choose.

    1) Keep the car
    2) Downsize
    3) Sell the car completely, and use carshare when required
    4) Keep car and rent car out on carshare
    5) … (whatever else you can come out with..)

  • Dean29 on 29/05/2017 - 14:59

    Sold my car for 15K and bought another one for 3k. I couldn't justify keeping an expensive car whilst not using it much and continuing to lose value.

  • isthisreallife22 on 30/05/2017 - 06:05

    Just out of curiosity, why do you not use your car much on weekends? In Melbourne, I'd spend all my weekends on Great Ocean Road, Yarra Valley, Dandenongs, Wilsons Prom, The Grampians, Phillip Island, Mornington Peninsula, etc.

    • E5TOQUE on 30/05/2017 - 17:53

      Have you seen Melbourne in winter? Its a miserable place and you dont want to venture out for a good 6 months of the year - maybe more. Maybe you are just way more adventurious? haha

      • isthisreallife22 on 30/05/2017 - 23:34

        Yeah winter is a bit brutal, but I maybe am adventurous :)

        I lived in London for 3 years without a car btw, and just car shared / rented for my weekend adventures around england/wales/scotland if ever required (but many weekends I was abroad).

        For mental health purposes though, best to have an avenue to escape lest you go stir crazy stuck in a rut

  • pencilman on 30/05/2017 - 08:12

    I have absolutely no experience with car sharing, but what about either
    1. selling your car and using a car share service when needed, or
    2. putting your car on the car share service and letting it earn some money?

    eg. something like this
    https://www.carnextdoor.com.au/

    Any one have any comments ??

    OP: the 'holding cost' of your car is say $750 registration, $900 insurance and $2500 (allowing 10% depreciation) = so >$4000.
    If you use your car twice a week, it costs $40 per use of the car plus petrol etc. So is it worth that to you?

    • E5TOQUE on 30/05/2017 - 18:05

      Well its funny you mention that:

      Rego = $787.40
      Insurance = $1600 (I have tried looking at other companies but its all the same, it must just be the area we live in)
      Depreciation = $2500
      Petrol = $700
      Maintenance = $850 per year (excluding new tyres)

      ~$6500 per year to own and run the car.

      I can't see us using $6500 worth of UBER/Hire Car's over the course of a year.

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